Forex
Gold Dips as Oil-Fueled Inflation Risks Lift US Dollar
The price of gold (XAU/USD) has dipped as investors take profits following a modest uptick in the Asian session. This move stalls a two-day rally from the $4,300 neighborhood.
The US Dollar (USD) is building on its overnight bounce, driven by inflation risks stemming from higher crude oil prices and the prospect of at least one interest rate hike by the US Federal Reserve (Fed) in 2026.
US-Iran tensions are also contributing to the safe-haven demand for the USD, which in turn is exerting pressure on gold.
The Iran-backed Houthi rebels have escalated their campaign against Saudi Arabia, disrupting commercial shipping traffic and fueling energy supply concerns that lift crude oil prices to a two-week high.